Karl Rove Re-Writes Economic History
Wall Street Journal columnist Karl Rove rewrote history to distort President Obama's record on the economy. Furthermore, the Journal again published an anti-Obama Rove column while failing to disclose Rove's ties to a conservative SuperPAC that is airing anti-Obama ads.
In publishing Rove's column, The Wall Street Journal continued to ignore its ethics problem  regarding Rove. Rove continues to use his Journal column to push the same message as his SuperPAC American Crossroads and its related group Crossroads GPS. But the Journal has repeatedly failed  to disclose Rove's conflict of interest.
Rove used his latest Journal column  to criticize Obama's acceptance speech at the Democratic National Convention. Rove attacked Obama for saying in his convention speech that he's not pretending that the economic "path I'm offering is quick or easy." Rove purported to contrast this statement with the prediction by the president's economic advisers that unemployed would have declines "to roughly 5.6% by today" if the stimulus bill was passed.
But this prediction, which was made early January 2009, came well before  the depths of the recession were known. Furthermore, while Rove's political group Crossroads GPS has repeatedly  pushed the myth  that the stimulus failed, the reality is that unemployment has been lower  every year than it would have been if the stimulus had not passed.
Rove also attacked the president for criticizing the Republican advocacy of more tax cuts and less regulation no matter what the economic situation. Rove wrote:
In his acceptance speech, Mr. Obama also renewed attacks on opponents for advocating "tax cuts" and "rolling back regulations on Wall Street." But his familiar, repetitive assaults on the policies that "drove our economy into the ditch," as he put it in a September 2010 speech in Wisconsin, raise questions about the president's lethargy.
If the Bush tax cuts drove the economy into the ditch, shouldn't Mr. Obama have asked Congress to cancel them as soon as he took office in 2009? Instead, he endorsed a two-year extension of the rates in 2010.
And what financial deregulation is Mr. Obama hinting at? The Bush years saw the passage of Sarbanes-Oxley and an attempt to regulate Fannie Mae and Freddie Mac. Mr. Obama presumably favored the former and opposed the latter.
In fact, Obama did ask Congress not to extend the Bush tax cuts for the wealthiest Americans almost immediately after coming into office. In the budget  Obama proposed on February 26, 2009 -- 36 days after being sworn in -- Obama asked Congress not to extend the tax cuts for families earning more than $250,000.
Furthermore, Republicans held aid to millions of unemployed Americans hostage  to get the Bush tax cuts for the wealthy extended at the end of 2010.
Rove also rewrote history to whitewash the record of Mitt Romney and the administration that he served in. Rove suggested that Obama is wrong to accuse Republicans of favoring harmful deregulation because the "Bush years saw the passage of Sarbanes-Oxley and an attempt to regulate Fannie Mae and Freddie Mac."
First, Romney has said  he would repeal Sarbanes-Oxley.
Second, the Bush administration's opposition to financial regulation did help create the economic meltdown. Indeed, as the financial crisis in 2008 grew, The New York Times reported  quotes from conservative economists that held the Bush administration at least partly responsible for the crisis:
In retrospect, "it would have helped for the Bush administration to empower the folks at Treasury and the Federal Reserve and the comptroller of the currency and the FDIC to look at these issues more closely," said Vince Reinhardt, a former Federal Reserve economist now at the American Enterprise Institute, a conservative-leaning research organization here.
William Donaldson, a former Wall Street executive with respected Republican credentials who became chairman of the Securities and Exchange Commission under Bush, quit in 2005 after facing resistance from the White House and Republican members of the panel, who criticized his support for stiffer regulations on mutual funds and hedge funds.
Today, even those sympathetic to Bush say he cannot disentangle himself from a home-lending industry run amok or a banking industry that mortgaged its future on toxic loans.
"The crisis definitely happened on their watch," said Kenneth Rogoff, a professor of economics at Harvard University who advises the Republican presidential candidate John McCain. "This is eight years into the Bush administration. There was a lot of time to deal with it."